World Liberty Financial minted 25 million $1 stablecoins on Monday morning and burned 3 million through its TokenGovernor contract, on-chain data shows, as the Trump-linked firm continues to manage the fallout from a credit position that trapped depositors in the DeFi protocol Dolomite.
The activity follows WLFI’s statement last week, published in response to CoinDesk’s report on Dolomite transactions, that it had repaid $25 million of the roughly $75 million it borrowed against its own governance token.
The company deposited billions of WLFI tokens as collateral and borrowed stablecoins that were partially sent to Coinbase Prime, pushing Dolomite’s $1 loan pool to near 100% utilization and leaving other depositors unable to fully withdraw it.
Monday’s minting was funded through BitGo Custody and executed through WLFI’s $1 Mint Authority contract. The 3 million USD1 burn moved from an address starting at 0x2ce to the TokenGovernor contract before being sent to the null address, permanently removing the tokens from circulation.
Smaller test transactions of $10, $10,000 and $40,800 in USD1 were sent to a previously inactive address in the hours before minting, a pattern consistent with wallet verification before larger transfers.
The net effect is an increase of $22 million in circulation from $1. Simultaneous minting and burning indicate active supply management rather than simple expansion.
However, the burning raises its own question about where that $3 million1 came from and why it was withdrawn rather than redistributed.
Stablecoin issuers routinely burn tokens when collateral is redeemed, but WLFI has not revealed the specific reason.
It is not yet clear whether the newly minted dollar is intended to replenish Dolomite’s loan fund, finance additional treasury operations, or serve another purpose.
The WLFI governance token has fallen approximately 15% since CoinDesk first reported the Dolomite transactions on April 9. Dolomite co-founder Corey Caplan is an advisor to World Liberty Financial.
CoinDesk contacted World Liberty Financial for comment in the European morning hours.
